Jobs fail to sway foes of tunnels

Monday

Sep 9, 2013 at 12:01 AM

STOCKTON - The promise of thousands of temporary construction jobs does not appear to have softened skepticism about what Gov. Jerry Brown's $24.5 billion twin tunnels could mean for this region's economy.

Alex Breitler

STOCKTON - The promise of thousands of temporary construction jobs does not appear to have softened skepticism about what Gov. Jerry Brown's $24.5 billion twin tunnels could mean for this region's economy.

State officials of late have repeatedly emphasized that the tunnels - whether Stockton residents think they're good for the Delta or not - will at least provide an employment opportunity for this city, still struggling to recover from the Great Recession.

According to the state's recently released economic analysis, building the 30-mile-long, 40-foot-wide tunnels beneath the river estuary will create 42,258 jobs in San Joaquin County alone over the decade-long construction period (although, in this case, the analysis defines a "job" as full-time work for just one year).

Within deeply opposed Delta communities, project backers have been publicly pushing jobs estimates, most recently in an op-ed published by the Manteca Bulletin in late August.

"One of the ironies of the current public debate is that (the project), according to the recent economic report, would have its biggest and most immediately beneficial impact on some of the same communities that are most opposed," wrote Jerry Meral, the governor's point man on water.

Meral pointed out Stockton recently filed for bankruptcy.

But readers should proceed with caution before accepting predictions about job creation, said Mark Plovnick, director of economic development at the University of the Pacific.

"There's no question that when you spend a lot of money on a project anywhere, it's going to have an economic impact in the short run," Plovnick said. "The general problem I have with these studies is what you get depends a lot on who commissioned the study; ... having looked at a bunch of them over the years, it appears there is a bias depending on who commissions them."

In this case, the study - by University of California, Berkeley, economist David Sunding - was ordered by the state agency that wants to build the tunnels.

No doubt, the anticipated 42,000-plus jobs in San Joaquin County alone - there would be 110,596 jobs overall - is "a pretty significant number," Plovnick said.

"The question is, 'Is it true?' " he said.

The projections raise a number of issues:

How much will the jobs really help?: A number means little without context, and it's clear the temporary jobs would not rescue Stockton from its problems altogether.

Averaged over the 10 years of construction, those 42,258 jobs would actually amount to a little more than 4,200 jobs at any given time.

To put that number in perspective, 38,200 people were unemployed in San Joaquin County as of July. The county has a total work force just shy of 300,000 people.

Furthermore, it would be dangerous to assume that all of the "new" tunnel jobs will be drawn from the county's large pool of unemployed workers, said William Lee, chairman of the Economics Department at Saint Mary's College in Moraga.

Job creation estimates are often overstated, Lee said, because some workers hired for special projects are already working on other jobs at the time.

Will local people be hired?: About 30 percent of tunnel workers are expected to come from out of state and live temporarily in the Delta region, according to environmental documents for the project. The reports acknowledge the need for specialists to run tunnel-drilling machines, and say out-of-region contractors "may bring their crews to the area."

"Many" workers, however, would be local.

Jeffrey Michael, a Pacific economist who has worked as a consultant for the anti-tunnel Delta Protection Agency, questioned whether unemployed Stockton-area residents will have the skills to work on the tunnels. A representative of the Stockton-based Operating Engineers Local Union No. 3, which represents thousands of construction workers, said it was too soon to take a stance on the project.

You wouldn't necessarily have to be a professional tunnel driller to benefit. The state's estimate of 42,258 jobs includes not only the construction workers themselves, but also far more of what economists would call "indirect" and "induced" jobs - those that occur when businesses such as restaurants or stores benefit from increased spending by tunnel workers.

What happens when the tunnels are finished?: The state foresees still more local jobs, as the tunnels plan also calls for converting roughly 100,000 acres of Delta farmland to habitat for fish and wildlife over half a century.

Plus, operating and maintaining the tunnels is supposed to create an additional 283 long-term jobs, 97 of them in San Joaquin County.

The state concludes that the overall economic impact on the Delta will be positive, though critics have said Sunding's analysis underestimates future impacts on water quality, among other shortcomings. They say diverting Delta water would cause further degradation of rivers and streams, harming the county's $2.9 billion agricultural industry and undermining the city's new $220 million Delta drinking water plant.

These are issues that must be considered, beyond the sheer number of construction jobs, said Lee, the Saint Mary's economist. "What will happen once the (tunnels) project is completed?" he asked. "Will the project benefit the region, or are the main benefits to other regions? Will all the non-locals leave the region and will the local workers become unemployed?"

Would the jobs help Stockton recover from bankruptcy?: The city's bankruptcy was created in part by a boom-and-bust housing economy, and the tunnels could create a similar effect, albeit on a smaller scale, Michael said. The extra jobs would help for a while, but when the project's over, the jobs are, too.

"It's a big project, and it might make a bit of a dent in the short run, but I just think this community would prefer the state made an investment that the community actually wanted," such as enhancements at the Port of Stockton, or improved highways and schools, Michael said.

Douglass Wilhoit, CEO of the Greater Stockton Chamber of Commerce, called the jobs estimate a "feel-good" number that had no substance. "I don't trust the state at all," he said, calling the reference to Stockton's bankruptcy a punch "way below the belt."

This is the same state government, after all, that took away community redevelopment money that might have helped Stockton recover from bankruptcy, Wilhoit said. "They didn't seem to care about the local economy then," he said.

Andrew Fields, director of water policy for the California Alliance For Jobs, said he hoped the jobs estimate would prompt Stockton-area citizens and leaders to reconsider the project, even though opposition dates decades to the original peripheral canal proposal of the 1970s and '80s.

There are people in San Joaquin County who have the training to work now on less-technical aspects of the project, including laborers and heavy-machine operators, he said.

"Behind the numbers are real families and real benefits, the majority of which will come from places like San Joaquin County," Fields said. "I know people have different motivations for support or opposition, but I would hope those opposed would take a look at things that the project could do, the economic stimulus that's going to come from it, and take a look at just why they're opposed. If they're still opposed, they have every right, but I would hope they would factor in more than just a single-minded point of view."